The opportunity for global soybean prices to rise sharply next year

Introduction: in the past three years, the global soybean market, like other major grain and oil markets, has been in a balanced market There have been many opportunities to show the momentum of breaking through the deadlock, but it has never been out of the balance of supply and demand The low point of the equilibrium market appeared in July 1999, and the high point appeared in May 2000, corresponding to the spot prices of US farms of 420 cents / bushel and 520 cents / bushel The corresponding CBOT soybean futures price is around 410 and 610 cents, that is, the box height of the spot price is 100 cents, and the box height of the CBOT soybean futures price is 200 cents In October 2001, the US farm soybean spot price broke through the bottom of the box and fell to 409 cents, but the corresponding CBOT soybean futures price did not reach a new low The author believes that the main reasons for the current balance pattern of soybean market are the overall sluggish global grain and oil market, the equal supply capacity of soybean in the northern and southern hemispheres and the synchronous and rapid growth of supply and demand So, what is the future trend of the global soybean market? The author believes that in order to study the situation of soybean supply and demand, we should pay more attention to the key factors unique to the grain and oil market besides the influence of the international political and economic situation on the grain and oil market 1 The overall supply and demand situation of grain and oil market As we all know, the price of the world's main grain and oil varieties has been running in the box for nearly three years Soybean, wheat and corn are closely related, so they are called "three swordsmen" in Chicago Growers will determine the planting intention of the three varieties according to the different market performance In the last year, the price of wheat and corn mostly moved in the upper half of the box, while soybean mostly moved in the lower half of the box The spot price of wheat is 20-30 cents / bushel higher than the subsidy loan level of USDA Corn moves near the subsidy loan level, while soybean price is far lower than the subsidy loan level The U.S Department of agriculture will modify the level of subsidy loans this year to reduce the level of soybean subsidy loans It is expected that the impact on sowing intention is relatively limited, with a maximum reduction of 3 million acres of soybean planting area, about 3 million tons of soybean Compared with the global soybean increase in recent years, the impact on the market is limited The basis of limited impact is: first, since 1973, the global wheat consumption has only increased by 1.2% annually, the coarse grain consumption represented by corn has only increased by 1% annually, while the soybean consumption has increased by 3.85% annually since 1978, which is even more extraordinary in recent years In recent years, the global soybean inventory / consumption ratio is far lower than that of wheat and corn, which shows that soybean is a best-selling variety It is impossible for the United States to substantially increase the output of unsalable products; secondly, wheat competition in the international market is intensified In the past year, Russia, India and Pakistan have all joined in the ranks of wheat exporting countries, and the supply capacity of exporting countries has greatly improved The sown area of wheat in the United States decreased from 77.84 million acres in 1990 to 59.6 million acres in 2001 Under the current market situation, it is unlikely to increase the sown area significantly The U.S Department of agriculture forecasts that the wheat acreage planted in 2002 will be 59.5 million acres, a decrease of 100000 acres over the previous year The United States is likely to plant two to three million acres of corn In a transparent market, the adjustment of planting structure is often a rational choice, and the result is likely to be a small increase in global wheat and corn production, which makes it continue to run in the original price box and reduce the possibility of breaking through upward Soybean prices will remain the weakest of the three 2 Climate factors This year's soybean production in South America is close to the end, and the harvest is almost certain Argentina's soybean growth is relatively ideal, while Brazil's soybean growth process is almost perfect, and the per unit yield may continue to rise At present, the market is particularly concerned about the climate conditions during the growth of soybeans in the northern hemisphere represented by the United States and China The temperature is high and dry this spring, and the market generally believes that El Nino will affect the soybean production this year As of mid April, rainfall levels in the United States this spring were significantly lower than the historical average The accumulated rainfall in the central and Western soybean producing areas of Iowa in the first quarter is about 100 mm lower than the historical average level American soybeans will be sown at the end of April and the beginning of May, mainly from the beginning of May In terms of historical laws, the annual rainfall over the years has little deviation, and less rain in spring may cause more rain in summer It is not ruled out that this year's rainfall is relatively small, but the time distribution is conducive to soybean growth Soybean is a rain loving crop, and the demand for rain water is not very large at the early stage of sowing In July and August, a large amount of rain water is needed to promote energy conversion during pod setting and grain filling period At present, it is still early to judge whether the climate conditions are ideal or not, and it is reasonable to temporarily determine it as a neutral factor The possible impact of weather changes should be closely monitored from the beginning of May 3 The uncertainty of Chinese soybean market In terms of supply and demand, China is the biggest uncertainty in the global grain and oil market in the future In the past decade, the increase of global soybean supply mainly comes from South America, while the increase of consumption mainly comes from China At present, there is no sign of slowing down of soybean planting area and yield growth in South America, and it is worth considering whether the soybean consumption growth rate represented by China can keep pace with it Now, after several years of extraordinary development, China's soybean consumption growth momentum shows signs of slowing down Most of the time in the last year, the processing soybean of oil and fat enterprises is in a state of loss In the near future, the price of soybean products is low, and the processing loss is more serious The soybean processing industry is likely to enter the consolidation stage Due to the huge stock of wheat and corn in China, the possibility of large-scale import in the early stage of China's accession to the WTO is unlikely, and the promotion of grain and oil prices in the international market is limited On the other hand, China's grain production appeared eight points in 1999, after which the grain inventory decreased year by year In the first half of the 1990s, four reasons promoted China's grain production to harvest year after year, accumulating a large number of stocks First, due to policy factors, the purchase price of grain has been raised by a large margin twice, with a total increase of 98%; second, the area has been expanded, with an increase of 60 million mu; third, farmers have increased their agricultural investment; fourth, climate cooperation has brought about favorable weather conditions Then four factors gradually weakened In 1999, China's grain planting area decreased by 9 million mu, and in 2000, it dropped by another 50 million mu In the past two years, the planting area has continued to decline In recent years, one of the measures taken by the local governments of all provinces to deal with the accession to WTO is to prevent the impact of imported grain and reduce the grain inventory However, in the event of a disaster, only by turning to the international grain and oil market for constant change and accumulation to a certain extent will stimulate the qualitative change of the market, from equilibrium to imbalance, and then seek new balance In a word, the author believes that soybean will still be a relatively weak variety in the global grain and oil market If the weather is normal in summer, the price box in the past two years will still be effective This year's soybean production in South America has become a foregone conclusion In the future, the market focus is mainly on the soybean consumption in China and the weather conditions during the soybean growth period in the northern hemisphere It is difficult to break through the situation this year In fact, since the 1970s, the grain and oil market has shown a cyclical pattern of market peaks every eight years or so The last high appeared in 1996, and the next high is likely to appear around 2004 At present, the market fundamentals have been slowly accumulating the energy to rise In recent two years, the global grain inventory has reached a relatively low level The continuous decline of China's grain inventory may lead to a significant increase in the import volume in 2003 In case of a disaster year, it is likely to boost the momentum and form a large upward market The leading varieties of grain and oil prices are likely to be corn that is not favored by the market at present Soybean and wheat will become follow-up varieties As corn supply in the international market mainly depends on the northern hemisphere, if the summer drought affects corn production, it will lead to a sharp rise in corn prices, which will further drive up the prices of soybean and wheat (author:) share to feed Weibo share to: